ayush gupta
After you have repaid your home loan in its entirety, it is crucial that you ask your lender to give you the No Objection Certificate (NOC). The No Objection Certificate is also sometimes known as the No Dues Certificate. It is a legal document issue by a bank or a non-banking financial company stating that the borrower has repaid the loan in full. Therefore, the lender has no legal rights over the property anymore.
It is the duty of the lender to send the home loan noc certificate to a borrower after they have repaid the home loan. However, sometimes, lenders forget to share this important document. At times, it has also happened that a lender sent the NOC on time. But the borrower never received it as the document got lost in the email. If you have repaid your housing loan and have not received your NOC. You can contact your lender and ask them to release the document. After you have received your NOC, make sure it has all the required details.
Your NOC must mandatorily contain the following details:
– Name of the borrower
– Address of the property that you had bought with the loan money
– Loan Account Details
– The document mentioned ‘no objection’ somewhere
These days, almost all lenders publish the basic format of NOC on their website. Once you receive your NOC, you can tally it with the sample NOC on your lender’s website and make sure all the details are aptly mention. Nothing is missing and there are no errors in the document. If your NOC does not contain the following details or if any of the details are incorrect, contact your lender immediately. Further, if your property is already registered. Talk to your lender and make sure they have shared the NOC with the Registrar’s office. This is important as only after your lender has sent the NOC to the Registrar’s office will the lien of hypothecation be removed from your property. You will become its sole owner.
Now that we know the basic things about the No Objection Certificate, let us look at why this document is so important and why you must obtain it immediately after repaying the loan.
Importance of No Objection Certificate
1. NOC is a legal document that states that the borrower has repaid the loan in full. Thus, in case of a problem between a borrower and their lender, the NOC serves as proof that the borrower has no obligation towards the lender.
2. It is only after a borrower has registered the NOC at the registrar’s office does the name of the lender get scratch off from the list of property owners. Thus, after a borrower submits the NOC at the registrar’s office and the Registrar removes the lien of hypothecation from the property. The borrower becomes the sole owner of the property and can sell the property as and when they like.
3. If a borrower does nor request a NOC and get their lender’s name remove from the list of property owner names. In case of an insurance claim, the money, in most cases, goes to the lender and not the borrower.
4. After a borrower repays a home loan repayment, their credit score automatically goes up. This improved credit score makes it possible for borrowers to avail of a loan in the future on beneficial loan terms and conditions. Credit rating agencies update a borrower’s credit score only after they have been inform that the borrower has repaid the home loan repayment in full. It is the duty of your lender to pass on this information to credit rating agencies. However, sometimes, lenders forget to share this information with credit information bureaus. If your credit score hasn’t improved even after repaying the entire home loan repayment on time, it is quite likely that your lender has not informed the credit information bureaus. In this case, you can get your credit score updated by sharing the NOC with the credit information bureaus.
5. In case of any legal hassles, the No Objection Certificate serves as proof of ownership and comes to the owner’s rescue. Therefore, all property owners must always have this document safely kept with them always.
Final Words
The No Objection Certificate or No Dues Certificate is a very important legal document. After you have repaid your loan, make sure to get the NOC from your lender. Keep this document safe with you. In case you misplace the NOC, do not worry. Simply file an FIR and submit a copy of this FIR along with a letter requesting a copy of the NOC. Please know that releasing the duplicate copy takes a bit of time. So, be patient.
A home loan is a long-term commitment. It is a decision that affects every aspect of a person’s life and for a long time to come. Thus, if you are planning to avail of a home loan, make sure to choose a lending partner who is reliable and trustworthy. Further, make yourself well-informed about everything there is to know about the home loan process.
